1. What is redevelopment?
Redevelopment is an important tool created by state law to assist local governments in eliminating blight from a designated area and achieving the goals of development, reconstruction and rehabilitation of residential, commercial, industrial and retail districts within the city.
Examples of redevelopment tools:
2. What is a Redevelopment Agency?
It is a locally controlled public entity that exists to alleviate blight and improve the city, create jobs, and strengthen the tax base. The Agency is governed by the City Council, which serves as the Board of Directors, but in fact is a separate and distinct entity from the City. By law, Agency funds must be spent on projects that benefit the City's redevelopment project area.
Redevelopment Project Areas are often created to:
3. What is blight?
Blight consists of the physical and economic conditions within an area that cause a reduction of, or lack of, proper utilization of that area.
4. What are the powers of a redevelopment agency?
A redevelopment agency's power is governed by the California Community Redevelopment Law (CRL). An agency may prepare and carry out plans for the improvement, rehabilitation and redevelopment of blighted areas. Once the plan adoption process has begun, an agency may exercise certain additional powers, such as acquiring property.
The California Community Redevelopment Law (CRL), contained in the California Health and Safety Code beginning with Section 33000 et seq., provides the authority and implementation provisions for a redevelopment program. California voters adopted Article XVI, Section 16 of the California Constitution in 1952, providing for tax increment financing.
5. Why is redevelopment important?
Redevelopment is one of the most effective ways a project area will receive focused attention and financial investment to reverse deteriorating trends, create jobs, revitalize the business climate, rehabilitate and add to the housing stock and gain active participation and investment by citizens which would not otherwise occur.
6. What can redevelopment do?
Redevelopment activities may include, but are not limited to:
7. Why can't private enterprise do it alone?
Community redevelopment is a partnership of public and private enterprise. Public funds are used to lay the foundation and provide the pre-conditions that are necessary for private enterprises to be interested in and capable of investing their financial resources. Through the redevelopment process, a partnership of public and private efforts can join forces to bring new life to deteriorating areas.
8. What is a redevelopment plan?
The plan provides the Agency with powers to take certain actions such as to buy and sell land within the area covered by the plan (project area), improving dilapidated facilities and to use tax increment financing. A redevelopment plan is adopted by ordinance of the governing body of the community. Adoption of the plan is based on the recommendations of the agency, the planning commission, and the project area or redevelopment advisory committee (if formed). Public hearings are required so that community input can be considered before the plan is adopted.
9. What is a project area?
The area within which actual redevelopment will take place. The project area must first go to public hearing (giving citizens who will be included in the project area a chance to express their views) after which the Redevelopment Agency acts on the adoption of the project area and becomes primarily responsible for future projects.
10. What is tax increment that finances redevelopment?
Tax increment is the primary source of revenue that redevelopment agencies have to undertake redevelopment projects that is based on the assumption that a revitalized project area will generate more property taxes than were being produced before redevelopment. When a redevelopment project area is adopted, the current assessed values of the property within the project area are designated as the base year value. Tax increment comes from the increased assessed value of property, not from an increase in tax rate. Any increases in property value, as assessed because of change of ownership or new construction, will increase tax revenue generated by the property. This increase in tax revenue is the tax increment that goes to the Agency.
11. Why does the agency have the power of eminent domain (condemnation of property)?
Eminent domain or condemnation is the right of a government to take private property for public use in exchange for just compensation. Agencies may use this redevelopment tool to assemble many separate parcels of land into a site large enough for their needs in order to reduce or eliminate a blighting condition.
12. What is relocation?
Relocation is the displacement of a business or family for the purpose of clearing land and preparing it for its designated use. When a person or business meets the legal qualifications, the redevelopment agency pays for: assistance in finding a new location, payments to help cover moving costs, and payments for certain other costs as provided by law.
13. How do redevelopment agencies maintain affordable housing?
California Community Redevelopment Law (CRL) requires that no less than 20 percent of tax increment revenue derived from a redevelopment project area be used to increase, improve, and preserve the supply of housing for very low-, low- and moderate-income households. If none is provided within a redevelopment project area, then the funds must be used to build twice that amount elsewhere. Possibilities include financial assistance to upgrade existing units, the construction of new housing, and improvements to public facilities and infrastructure that service low- and moderate-income neighborhoods.
14. How can I learn more about Redevelopment?
A good resource for learning more about redevelopment is the California Redevelopment Association web site, which can be found at www.calredevelop.org.